January 29, 2009, 12:00 AM

Click fraud reaches record high in Q4

The average click fraud rate for paid search advertisers reached a record 17.1% in the fourth quarter, up from 16% for the third quarter and 16.6% for Q4 of 2007, web traffic quality auditor Click Forensics reports.

Click fraud is at its highest rate ever, new research shows. The average click fraud rate for paid search advertisers reached a record 17.1% in the fourth quarter, up from 16% for the third quarter and 16.6% for Q4 of 2007, web traffic quality auditor Click Forensics Inc. reports.

Click fraud traffic from botnets, robotic software that automatically clicks on ads, increased 14% for the quarter-the second highest jump ever, Click Forensics says. Botnets were responsible for 31.4% of all click fraud traffic in Q4 2008, up from 27.6% for Q3 and 22.0% for Q4 2007.

“Based on the data we tracked, it seems that the online advertising industry is not immune to the growing tide of cybercrime during this recessionary period,” says Tom Cuthbert, president of Click Forensics. “In addition, we’ve started to see old schemes like click farms reemerge. Advertisers should pay close attention to these types of threats in their online campaigns throughout the year.”

Click farms are groups of people who are paid to click on ads.

In Q4, the countries outside the U.S. producing the most click fraud include Canada with 7.4% of fraud, Germany with 3.0% and China 2.3%.

The data, which is published each quarter, monitors online ad campaigns for click fraud using information from search campaigns and advertisers’ web sites.

The average pay-per-click fraud rate on search engine content networks-aggregators of publisher sites on which search engines serve ads, as opposed to ads served on the search engines themselves-was slightly lower than the average industry fraud rate. Across Google AdSense and the Yahoo Publisher networks, it was 28.2%, up from the 27.1% for Q3 2008 and down slightly from 28.3% for Q4 2007, Click Forensics says.

Click Forensics attributes much of the recent rise to the general rise in cybercrime during this recent economic downturn. It notes that other forms of cybercrime such as malware and phishing have risen recently as reported by security and tracking firms McAfee, PricewaterhouseCoopers and Websense.

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